Regional security and challenges
Asia’s sustained path of economic progress and human development like a sword of Damocles.
Asia’s flash points
It is axiomatic that accelerated economic growth, in the region will require energy. It has been estimated that a 1 percent GDP growth will require 10 times more energy which, if inadequate for the requirements of growth, could trigger political insecurity, provoke an accelerating arms buildup and deepen geopolitical rivalries.
Parenthetically, the Asian region has significantly accelerated its arms buildup, now higher than that of post-Soviet Russia. Asian nations, including India, are rapidly developing new long-range strike capacities as legions of new missiles and aircraft become operational. This “Arms Race Asia” is troubling not only for its pace but also for its alarmingly high technological level.
The region’s economic growth and serious energy shortage are leading the area swiftly towards a struggle for offshore oil. Moreover, with regional energy shortages as a result of high growth, the attractiveness of nuclear energy grows in Asia, even as it declines elsewhere. It is useful to note that nearly half the increase in the entire world’s nuclear energy production in the next few years will be in East Asia. These plants will most likely produce dangerous amounts of plutonium, a key raw material for nuclear weapons.
Compounding the energy- related security dangers in Asia are troubling geostrategic uncertainties. Surrounding Japan, in a prospective Northeast Asian arc of crisis, are heavily armed nations — notably the two Koreas, China and Taiwan.
Factors for volatility
Asian energy markets will change sharply, with major new importers like China, India, and Asean — including Indonesia — emerging, and regional competition for limited supply growing much keener. At the same time, Asia — especially China — will grow dramatically more dependent on the Middle East, the world’s low-cost source of oil, with the volume of petroleum passing eastward through the Strait of Malacca likely to triple within the next 15 years. Asia’s rising role as a source of new demand in global oil markets may not affect Europe, its economic ally, for another decade, or perhaps more. The collapse of Eastern European and to some extent Latin American demand, amid debt crises, has created slack and bought time for global markets, as has the shift to high technology and services in the economics of the advanced industrial world. But Asia’s rising demand will dangerously deepen overall global dependence on OPEC — to between 45 and 60 percent, by International Energy Agency estimates. A generation from now Asia, in short, could well be the cause of Europe’s next oil shock — at a point when North Sea oil and gas will provide much less of a cushion for the continent than it does today.
Asia’s relationship with the Middle East will deepen rapidly over the coming decade, the BRI initiative will see to this. The most dynamic — and rapidly deepening — element will be the new linkage between China, a net oil importer, and the Persian Gulf States, particularly Iran.